Areef Patel, Vice-Chairman, Patel Integrated Logistics Ltd

BEFORE
The logistics sector generates mass employment and is a key revenue earner for the government. In order to improve the competencies of the logistics sector, the Goods and Services Tax (GST) should be implemented without further delay, which could result in potential savings of around $200 billion and lead to streamlining of the taxation structure and reduce inventory maintenance costs. The GST regime should reflect PM Narendra Modi´s vision of making India one of the easiest places to do business and not be used as a tool to harass consumers and the business fraternity. The Modi regime needs to ensure that laws facilitate speedy business deals and make business relationships easier. The Budget should make special provisions to allocate funds for upgrading specific skill sets and performance delivery capabilities of transportation and supply chain professionals through allocation of funds. Big-ticket game-changing projects like the Diamond Quadrilateral, the Sagarmala Project and a plan for construction of Expressways along high traffic density corridors should be expedited on a priority basis, removing hurdles in the last mile delivery of goods and making logistics operations seamless and cost-efficient along with reducing delivery lead times.

Onus also needs to be placed on promoting eco-friendly logistics with the budget, incentivising the utilisation of solar energy in logistics services like warehouse management and promoting green solutions across the supply chain spectrum. Measures need to be initiated to reduce logistics costs in India, which constitute around 13 per cent of GDP. This will in turn will make Indian exports competitive in the global market and reduce the landed cost of imports, catapulting the economy in the higher growth trajectory.

After
The partnership of the Railways with logistics players for implementing end-to-end integrated transport solutions for select commodities is a definite game-changer for the domestic logistics sector and will usher in seamless movement of goods and services. The increase in budget allocation for highways and the identification of 2,000 km of roads for boosting coastal connectivity will ensure increased connectivity with ports and far-flung villages, expanding the operational framework for logistical companies and improving last-mile deliveries at affordable costs.

The move to develop strategically located multimodal logistics parks with multimodal transport facilities has the potential to make our economy globally competitive. Efforts need to be expedited to bring the largely unorganised domestic logistics sector within the organised structure, while efforts need to be intensified to digitise the operations of the domestic logistics industry, which remains largely cash-intensive.